Saturday, May 7, 2011

Obama forms panel to improve fracking safety

WASHINGTON May 5 (Reuters) - After a series of high-profile natural gas drilling spills, the U.S. Energy Department named a panel to recommend ways to improve the safety of hydraulic fracturing, or fracking, a technique that has expanded the country's potential to extract the fuel.

President Barack Obama asked the DOE to form the panel of academic and environmental experts to identify any immediate steps that can be taken to improve the safety and environmental performance of fracking, the DOE said on Thursday.

The panel, which includes John Deutch, a professor at the Massachusetts Institute of Technology, and Daniel Yergin, the chairman of IHS Cambridge Energy Research Associates, will report those steps within 90 days of beginning their work.

Within six months they will also develop advice for the government on practices for shale extraction to ensure public health and the environment.

"America's vast natural gas resources can generate many new jobs and provide significant environmental benefits, but we need to ensure we harness these resources safely," DOE Secretary Steven Chu said in a release.

Drillers say fracking has opened up vast new supplies of natural gas that will reduce imports of the fuel. Backers also say it could reduce oil imports in the future, if vehicles are converted to run on natural gas.

But residents near drilling wells have complained fracking has polluted ground water supplies. In addition, accidents at wells have led to fires and floods of fracking fluids have reached streams.

Late last month Chesapeake Energy (CHK.N: Quote) suspended fracking operations in Pennsylvania after thousands of gallons of drilling fluid used in the process spewed from a well after a blowout.

And early this year a Congressional probe found a dozen energy companies used diesel in their fracking fluid without permits.

The Environmental Protection Agency is studying fracking practices, but initial results are not expected until late 2012.

The other members of the panel are Fred Krupp, president of the Environmental Defense Fund, Kathleen McGinty, a former secretary of of the Pennsylvania Department of Environmental Protection, Susan Tierney, a managing principal at Analysis Group, which does economic and financial consulting, and Mark Zoback, a geophysics professor at Stanford University. (Reporting by Timothy Gardner; Editing by Cynthia Osterman)